Google's Antitrust War With Feds May Be Over Before It Began
Those who were salivating over the prospect of a Google showdown with the U.S. government over antitrust issues are likely to be disappointed. It appears the FTC's two-year examination of Google's search practices will lead to Google making some voluntary changes that may benefit competitors, but that's about it. Europe may have a more jaundiced view of Google's behavior, however.
Dec 17, 2012 2:59 PM PT
A two-year FTC probe into Google could be coming to an end. The Federal Trade Commission may close its investigation into the search giant as early as this week, and it appears that Google will avoid a consent decree, according to reports.
This would mean Google would not have to agree to any formal FTC settlement or specific terms. However, it does seem likely that Google will make voluntary changes to the way it conducts its search business to satisfy some of the agency's larger concerns.
Moreover, Google may be subject to a consent decree related to the handling of the mobile-technology patents it acquired with the purchase of Motorola Mobility earlier this year.
The FTC likely did find evidence that Google improperly declined to award patent licenses to some mobile-device competitors, according to accounts. Google will likely make a formal commitment to fairly license those patents.
Assuming this is the way it plays out, it will be a big disappointment for the FairSearch.orgconsortium of companies that sought to have the search engine playing field leveled.
It appears likely that Google will agree to new limits on its ability to use snippets of content from the websites it lists in its rankings, and that it will make it easier for marketers to transfer online ads to other services. However, this may not go far enough to satisfy everyone.
"FairSearch and its members will continue working with authorities and policymakers to ensure that Google is not given free rein to determine winners and losers in the marketplace," said Ben Hammer, FreeSearch.org spokesperson. "Ultimately, that power should rest with consumers in a free market."
Google and the FTC did not respond to our requests for further details.
To call Google a search engine giant is a true understatement; at present, Google owns nearly 70 percent of the nation's search market. The FTC did find that Google does somewhat favor its own products, according to unnamed sources cited in multiple press reports. However, it seems the agency also concluded that Google wasn't engaging in illegal or even anticompetitive behavior.
"This is going to be deeply disappointing to Google critics and opponents," said Greg Sterling of Sterling Market Research.
Could the next step be that groups such as FairSearch.org will take their case elsewhere?
"There was a suggestion that they might take up their cause with the DoJ; however I don't think that will necessarily be any more successful," Sterling told the E-Commerce Times. "There will probably now be a public outreach or PR campaign. Microsoft has been doing this and will continue to educate the public about Google's alleged abuses."
The allegations against Google leveled by FairSearch.org and others have mainly focused on how the company generates and displays search results. Google Shopping results now turn up all paid ads, and rival Microsoft -- a member of the FairSearch.org consortium -- fired back recently, noting that its Bing search engine offered an alternative. Last week Microsoft went so far as to launch a high-profile ad campaign that suggested Google was "Scroogling" consumers.
Although Ebenezer Scrooge doesn't have his hands in this, is it possible that U.S. government officials are playing nice with Google?
"The potential FTC outcome [doesn't] indicate any favoritism on the part of the Obama administration toward Google," said Sterling. "From a legal standpoint, it was always a very tough case against the company -- much harder than it appeared outwardly perhaps. The Europeans may have more flexibility and more options. Accordingly, there may be some tougher action there."
And Google isn't exactly out of the woods yet, either.
"The state attorneys general may still pursue some sort of case or action against Google," Sterling emphasized. "The FTC decision doesn't preclude that."
Should Google manage to avoid the courts altogether, there is still the court of public opinion -- and that could be what makes or breaks the company in the end.
"Ultimately this issue comes down to an unbiased user experience," said Josh Crandall, principal analyst at Netpop Research.
"Consumers are looking for transparent, helpful information from Google search," he told the E-Commerce Times. "If they believe that Google is imposing its own world view on the user experience, then consumers will elsewhere for their needs. This is a victory for Google, but ultimately it's the user that influences the outcome of this issue over the long haul."